At the beginning of the new trading week, which is the 13th one of 2021, the US dollar (USD) remains close to its maximum exchange rate against most major world currencies. Since November last year the USD has been supported by positive investor sentiment for the US economy, along with the availability of coronavirus vaccines. Meanwhile the single European currency, the euro (EUR), is still recovering from the huge exchange rate losses from the previous period. European countries are still facing an onslaught of new cases of Covid-19 and restrictive closures are still taking place in many EU countries.
On 30 March 2021, at 6:44 am CET, the global currency pair EUR/USD was traded on the international foreign exchange – Forex market – at a mutual exchange rate of US$ 1,176 per EUR with the current daily slight strengthening of the EUR by +0.03% against the USD. The decline of the EUR below the US$ 1.18 exchange rate was an unpleasant surprise for many investors, but a large number of analysts predicted this development and now expect a further possible decline in the euro exchange rate against the USD to US$ 1.16 per EUR.
This reciprocal exchange rate between the USD and the EUR was achieved when, according to the US Dollar Currency Index (DXY), the USD was seen at a price level of 92.93 with a daily decrease of -0.02%. On 30 March the USD weakened slightly against the EUR, but in Asian markets the USD continues to strengthen and, for example, against the Japanese Yen (JPY) it was already significantly closer to the mutual exchange rate of 110 JPY per USD when it traded at the rate of JPY 109.94 per USD with the daily strengthening of the USD by +0.15% against the JPY.
The current gains of the USD over the past few weeks have been so rapid that some analysts and foreign exchange market financial strategists have warned of a sharp fall from its current level. “We believe recent moves in FX markets are corrective and not part of a new 2021 trend,” said ING analysts. However, the EUR has already managed to return from its four-month low on Thursday, 25 March even though it has been thwarted by doubts regarding the slow pace of vaccination. The German survey is expected to show an improvement in business morale and positive investor sentiment in the short term, but it is unlikely that the decline of the euro will stop, economic correspondents state.